Figuring Rakeback into your Poker Profits

Of all the bonuses and deals that have been trotted out by online poker rooms, rakeback is perhaps the most enticing.  After all, who doesn’t like to have a large percentage of the money that online poker rooms take returned to them?

Taking this a step further, many semi-pro and pro online players not only like rakeback, but rely on it to show a profit at the end of the month.  Even those who aren’t in the professional ranks still benefit greatly by tacking rakeback onto their online poker earnings.

Unfortunately, there are still plenty of internet players who are in the dark about how rakeback affects their profits.  Some of these people may not even be signed up for rakeback deals and are missing out on all of this extra cash.  If you’re in either of these situations, you definitely need to know how to figure rakeback into your profits, and this all begins with knowing how rakeback is dispensed.

How Rakeback is awarded

As many of you already know, rake is what online poker rooms take out of a pot as a fee for running the game.  In cash games, rake is taken out of each hand’s pot while the house gets its money from tournaments by tacking on a 10% fee – i.e. $20 + $2.

Rakeback is the amount of money that a poker room returns to its players as a reward for playing at their room.  Some rooms offer a fixed amount of rakeback such as 33% while other rooms offer varying amounts of rakeback depending on how high you are ranked in their VIP club.  The high stakes players at the top of a VIP club can earn as much as 80% in rakeback!

It’s easy to figure out how much rakeback you’ll get from a tournament since you just take the percentage awarded times the extra amount you pay in entry fees.  For instance, if you paid a $30 + $3 buy-in and earned 33% rakeback, you would earn $0.99 in rakeback ($3 X 0.33).

Cash games get a little tougher because they don’t work out so nice and neatly.  For example, if $3 was raked from a pot and your room featured a 33% rakeback deal, you wouldn’t get the full 99 cents because you aren’t the only person in the hand.  The amount you get depends on if your room operates by the ‘shared’ or ‘contributed’ rake rule.

With the shared rule, every player who is dealt into a hand will earn an equal percentage of the rakeback.  So if you’re at a 10-person table, you will all receive 10% of the rakeback.  With the contributed rule, the amount you contribute to the pot determines how much rakeback you’ll get.

How Rakeback will affect your Profits

Once you know how your room awards rakeback, it’s time to look at how this amount helps your poker profits.  How you determine this number will depend upon several other factors in addition to rakeback.  Stakes, hours played, hands per hour, table size, and multi-tabling will all factor into how much rakeback you make.

Several online poker sites provide calculators that use these factors to give you generic estimates on how much rakeback you can make in a day, week, and/or month.  Of course, you can also do your own estimates without using a calculator, but it gets kind of messy.

To illustrate this point, let’s say the following conditions apply to your cash game table play: 30% rakeback, shared rake, full tables (10 players), $1/$2 No-Limit Hold’em, $30 average pot size ($1.50 house rake), playing two tables (200 hands per hour), and 4 hours a day.

To break this down, let’s find out what your rake per hand would be.  The formula for finding this number is: $1.50 (house rake per hand) X 0.30 (rakeback) X 0.10 (shared table) = $0.045.  So you’d be making 4.5 cents in rakeback each hand.

To find you how much rakeback you make in a day, we’ll add in the fact that you play around 800 hands a day (200 hands per hour X 4 hours a day).  After taking 800 hands X $0.045, you’d find that you’re making $36 a day in rakeback, which is a pretty nice bonus.  Putting this into a monthly number, you would be making $1,116 a month!

Are you taking Advantage of Rakeback?

Earning anywhere close to $1,116 a month just for playing $1/$2 No-Limit Hold’em four hours a day is outstanding.  And as you can imagine, the money only gets bigger when you move up in limits.  For this reason, you absolutely must take advantage of rakeback deals.  Even if you’re only an average player, rakeback could make you a profitable player in the long run.

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